RIVERWOODS, Ill.--(BUSINESS WIRE)--Sixty percent of former college students who are currently repaying student loans are concerned their student loan repayments will cause them to work extra jobs to make ends meet, according to a survey commissioned by Discover Student Loans. This year’s survey examined perceptions about repaying student loans and the impact of repayment on finances and lifestyle choices.
Reality sets in for college graduates
- In addition to working extra jobs, more than half (59 percent) of former college students (identified as those aged 24-28) reported being concerned about having to give up fun activities to afford their student loan payments, while only 26 percent of students still in college or recently graduated (identified as those aged 18-24) felt the same way.
Students and parents claim to understand the student loan repayment process
- 53 percent of former students and 54 percent of current or recently graduated students said they completely or somewhat understand how to budget their student loan payments alongside other expenses like rent, food or a car.
- 59 percent of former students said they understand how much their student loan payment will be each month.
- 47 percent of parents with college-bound students and 44 percent of parents of current or former college students said they completely understand the impact defaulting on student loan payments has on their child.
“It’s never too early for families to start discussing how best to finance a college education. It’s important for both students and parents to be on the same page and start thinking about and budgeting for things like student loan payments early on in the process,” said Nicole Straub, vice president for Discover Student Loans. “Discover has many free online resources that provide tips and advice on things families can do at all stages of the college process to help feel more financially prepared.”
Parents’ primary concerns…and sacrifices
- 61 percent of parents of college-bound students, and 56 percent of parents of those currently in school and recently graduated expressed their top concern is their child not being able to make the monthly principal and interest payments on their student loans.
- A third of parents are willing to give up social media forever if it meant it would lessen the impact of student loans for their child. Other things parents are willing to give up include online movie streaming, desserts for the rest of their life, their cell phone for five years and the last season of their favorite show.
Getting a job is top priority
- 60 percent of current and recently graduated students and 67 percent of former students said getting a job was most important following graduation, followed by having financial stability and paying back student loan debt.
- The majority of parents surveyed said their child getting a job after graduation was the most important thing to them.
“Graduation brings responsibilities such as finding a job and repaying student loans. As graduates prepare to go out on their own, they should take time to review their personal finances and prepare a monthly budget that will accommodate not only rent, food and having fun but a potential student loan payment,” said Straub.
Discover Student Loans offers tools and resources to help parents and students understand the college financing process. For more information about Discover Student Loans, please visit www.discover.com/student-loans.
About the Survey
The Discover Student Loans national online survey of 2,015 students, former students and parents in the U.S. was conducted between April 26 – May 7, 2018. Four similar surveys were administered among specific target audiences, by Research Now, an independent survey research firm. Target audiences included Parents of “College Bound” Students (age 16-18); Parents of Current and Former (Recently-graduated, age 18-24); Former Students (age 24-28); Current and Former (Recently-graduated, age 18-24) Students. The margin of sampling error was +/-3 percentage points with a 95 percent level of confidence.
Discover Financial Services (NYSE: DFS) is a direct banking and payment services company with one of the most recognized brands in U.S. financial services. Since its inception in 1986, the company has become one of the largest card issuers in the United States. The company issues the Discover card, America's cash rewards pioneer, and offers private student loans, personal loans, home equity loans, checking and savings accounts and certificates of deposit through its direct banking business. It operates the Discover Global Network comprised of Discover Network, with millions of merchant and cash access locations; PULSE, one of the nation's leading ATM/debit networks; and Diners Club International, a global payments network with acceptance in 190 countries and territories. For more information, visit www.discover.com/company.